Australian gold miner Northern Star Resources has lowered its full-year production guidance following operational challenges at its Kalgoorlie Consolidated Gold Mines (KCGM) operation, in Western Australia, despite posting solid March quarter results and reaffirming its longer-term growth trajectory.

The ASX-listed gold miner cut its full-year production guidance to between 1.63-million and 1.66-million ounces, down from a previous range of 1.65-million to 1.8-million ounces. The revision stems from mining delays at KCGM’s Golden Pike North zone, where low productivity has hampered access to high-grade ore.

“During the March quarter, we delivered strong net mine cash flow of A$295-million across all production centres despite operational challenges at our biggest asset, KCGM,” said MD Stuart Tonkin. “Mining efficiency is on track to lift significantly in the June quarter.”

Tonkin noted that the company remaine in a net cash position and expected free cash generation to increase, supported by historically high gold prices. “This enables us to reward shareholders,” he said.

The all-in sustaining cost (AISC) guidance for 2025 was also revised upward to between A$2 100/oz and A$2 200/oz from a prior range of A$1 850/oz to A$2 100/oz. The increase reflects delayed access to higher-grade ore at KCGM, unplanned maintenance across the Yandal operations, and higher royalties driven by elevated gold prices.

The growth capital expenditure guidance (excluding the KCGM mill expansion) was raised to between A$950-million and A$1.1-billion, reflecting accelerated development at key sites such as Wonder Underground (Thunderbox), Griffin (Jundee), and Mt Charlotte. Exploration spend was lifted to A$230-million from A$180-million, following promising results that have prompted increased drill drive development across KCGM, Pogo and Jundee.

Northern Star reported that the KCGM mill expansion project remained on budget and on schedule. With A$728-million spent to date, the project would double processing capacity to 27-million tonnes a year and underpin steady-state production of around 900 000 oz/y from the 2029 financial year.

In the March quarter, Northern Star sold 385 441 oz of gold at a group AISC of A$2 246/oz. Kalgoorlie delivered 196 623 oz at A$2 139/oz, Yandal produced 120 764 oz at A$2 398/oz, and Pogo sold 68 054 oz at a lower AISC of $1 439/oz.

All-in costs were A$3 358/oz, reflecting the continuation of capital projects across the group, particularly at KCGM.

Despite the revised guidance, Northern Star reiterated its confidence in the growth outlook and its ability to self-fund the A$1.5-billion KCGM expansion through ongoing cash flow. Major construction works for the loadout facility were scheduled for the June quarter, with ramp-up still expected in early 2027.